NIM25043 - Class 3 NICs: Deficiency Notices: Special provisions for time limits and higher rates for 1996-97 to 2001-02 inclusive

Regulations 50A and 65A, Social Security (Contributions) Regulations 2001

The above regulations came into force on 17 May 2004 and put in place special provisions to apply for the six years 1996-97 to 2001-02 (inclusive). The time limits and applications of the higher rates operate as normal for years before and after this period. The special provisions do not apply to voluntary Class 2 NICs.

Deficiency Notices were not issued for the years 1996-97 to 2001-02 and so contributors were not prompted to enquire into their National Insurance record for those years. Before re-instating the annual issue of Deficiency Notices in October 2004, Inland Revenue ran a one-off exercise to issue Deficiency Notices for 1996-97 to 2001-02.

The above legislation allowed everyone extra time to pay Class 3 NICs for 1996-97 to 2001-02 and removed the higher rate provisions for those years. This gave effect to the policy decision that no one should be disadvantaged by the late issue of Deficiency Notices for the years 1996-97 to 2001-02.

The time limits for 1996-97 to 2001-02 depend on when the contributor reached State Pension age.

  • Contributor reached State Pension age by 23 October 2004
  • Class 3 NICs must be paid on or before 5 April 2010.
  • Contributor reached State Pension age on or after 24 October 2004
  • Class 3 NICs must be paid on or before 5 April 2009.

Provided Class 3 NICs were paid by these dates they were payable at the rate that originally applied to the relevant year(s).